European Stocks Close Higher On Rate Cut Hopes

(RTTNews) - European stocks closed higher on Monday, with buying gathering momentum in late afternoon trades as investors awaited some crucial economic data from the U.S. and Europe later in the week.

Still, with the U.S. market closed for Memorial Day, activity was rather lackluster till around mid afternoon. Optimism about an interest rate cut by the European Central Bank at its next meeting aided sentiment.

Euro zone consumer prices data for May could provide additional clues on whether the ECB will cut interest rates next week.

The release of the Fed's preferred inflation gauge on Friday could help traders access the timing and pace of Fed rate cuts this year.

The pan European Stoxx 600 climbed 0.32%. Germany's DAX and France's CAC 40 gained 0.44% and 0.46%, respectively, while Switzerland's SMI ended 0.24% up. The U.K. market was closed due to Bank Holiday.

Among other markets in Europe, Belgium, Finland, Greece, Iceland, Netherlands, Norway, Poland, Portugal, Spain and Sweden closed higher.

Austria, Czech Republic, Denmark, Russia and Turkiye ended weak.

In the German market, RWE, Bayer, Continental, Zalando, Volkswagen, Covestro, BASF and Symrise gained 1 to 2.5%.

In the French market, Teleperformance, Veolia, Edenred and Stellantis gained 1.5 to 2%. Vinci, Bouygues, Safran, Hermes International, Essilor and LVMH also ended notably higher.

Alstom shares gained about 5.5%. The multinational company specializing in the manufacture of rail transport equipment and systems has launched a share capital increase with preferential subscription rights for an amount of about 1 billion euros, thus executing the final step of the announced 2 billion euros deleveraging plan.

Societe Generale, STMicroElectronics and Legrand closed weak.

German business sentiment remained unchanged in May, survey results from the ifo Institute showed. The business climate index posted 89.3 in May, unchanged from April. The score was forecast to improve to 90.3 in May. The score for April was revised down from 89.4.